Understanding how credit cards work can be hard to say the least. There are so many different types of Visa cards, interest rates and rewards that the average consumer can hardly keep up. First time credit card users, especially, are bombarded with offers and it is hard to know where to turn.
When considering what type of credit card to get it is important to understand your spending habits as everyone is different. If you travel a lot then you should take advantage of a card which earns you travel miles and also allows you to spend money abroad. Understanding the card you need is only half the battle, although it is the best way to save money. Spending money on interest payments because you have the wrong card is a waste. So the first tip to save money when applying for a card is to find the best one for you. There are several fancy things you can do with cards but at the most basic level this is a great way to save your money on inflated interest levels.
Be sensible when spending on your card. Your card will have a limit and you shouldn’t go over this. You should try not to spend more than you have, by drawing up a budget you can easily assess how long it will take you to pay off the purchase and how much it will end up costing.
One of the best things about a credit card is the amount of time you have to pay off a purchase and if you are clever you can actually earn money by taking out a card. For example if you buy a pair of shoes on your credit card today, you only have to pay the bank back for those shoes in a month’s time. By using this rule you can earn interest of the amount the shoes cost. To pull this trick off you need to have the amount the shoes cost in your current account (or even better a high interest account). By putting the shoes on your credit card you can earn interest on the amount the shoes cost. As long as you pay off the amount outstanding at the end of the period you will earn money. Another handy trick is to put your entire monthly spending budget onto your credit card, and earn interest that way.
There are hundreds of rewards on offer and every credit card company will have some kind of gimmick to pull you in, some will offer zero percent on balance transfers while others may have insurance on all purchases. Make sure you take out a card which will offer you the most for your money. As long as you are sensible you can save money by using your Visa cards in moderation.